DRAM Prices To See Sharp Rise Again

Samsung 14nm DDR5 DRAM

Up until now, people have been able to enjoy consistently cheap DRAM modules and flash memory offerings, but that will now come to an end. Analysts warn that manufacturers are now in the process of demanding “aggressive increases.”

Manufacturers creating shortages themselves

It had already become apparent a few weeks ago when Samsung stopped producing flash memory in order to stop the price decline for solid-state drives (SSDs) and other storage products.

Now there is movement on the market, writes analyst TrendForce. DRAM and NAND flash prices are now in the process of stopping the previous downward trend and rising again in the fourth quarter. TrendForce initially expects an increase of between 3 and 8 percent this year, i.e. quite moderate.

However, the price increases will ultimately depend on whether manufacturers maintain their production cuts. In addition, it is currently difficult to predict how demand will develop.

The need for servers is likely to be the deciding factor. According to TrendForce, most manufacturers are resistant to further price cuts and now want “aggressive increases.” Additionally, PC DDR5 prices have already increased in the third quarter, and a rise in the fourth quarter will make consumer hardware even more expensive.

Samsung is said to have increased its production cuts in recent weeks, particularly for server DDR4 memory modules. TrendForce reports that this has led to a shortage of DDR4 stocks for servers, so prices in this segment will inevitably rise. Accordingly, other manufacturers are now trying to benefit from this shortage of supply by increasing their DDR5 production.

Where would it go?

In recent years, consumers have purchased fewer computers, smartphones, and tablets due to high prices. This in turn led to falling demand for components such as memory, which pushed prices down. Global PC sales figures fell again in the third quarter. An increase is expected for the fourth quarter, but this will probably only be driven by the Christmas season.

All in all, TrendForce expects prices for consumer DDR4 modules to increase by up to 5 percent and for DDR5 between 3 and 8 percent. On the server side, however, DDR4 prices will remain stable and DDR5 prices will continue to fall.

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